Will you be a microISV casualty?

When discussing success rates for
new business startups, most people are quick to quote the statistic
that 95% of new businesses will fail within X (1, 3, or 5 seem to be
most common) number of years. If this is true, then the failure of
microISV businesses will be no different. What’s interesting is why the
majority of microISV companies fail.

The main reason that the
majority of the companies with completed products fail is due to the
lack of marketing. This would seem to be obvious because most microISV
businesses are created by programmers who don’t have experience or, in
a lot of cases, the desire to do the marketing that is necessary to
make their product a success. My observation is that there are far more
microISV companies that fail before they even get to this stage though.

The
simple explanation is that most microISVs will fail because they will
never complete their product. But why is this the case? Even though the
common way of thinking is to start your microISV while holding down a
day job, which is the method of minimal risk, most people fail because
they actually fear the risk of success. Once someone starts down the
path of creating a project with the grand idea of leaving their crappy
job behind they will inevitably end up having to face the idea of not
having a steady paycheck, paying self employment taxes, and, in the
U.S., paying for health insurance entirely out of your own pocket. With
these thoughts the spiral begins.

Unfortunately, we have
become a world of comfort. It is all to easy to go to school, get a
job, work up, around, and through the corporate world and continue to
draw a steady paycheck. Faced with the comfort of a steady job, the
decision to risk success on your own actually becomes a daunting
thought to many. At this point, the easiest thing to do is quit. It
requires no change since you have a steady, stable paycheck. You won’t
have the hassle of working on your project at night and on the
weekends. And think of all the time you won’t have to spend supporting
your customers. Life will go back to being comfortable…and
disappointing.

Always remember why you started your project in
the first place. The goals you set originally were what you thought
would provide you with an improved lifestyle. The lifestyle and level
of comfort that can be attained by selling something you created
yourself can be far more satisfactory even if you never make as much
money as you did in your corporate job, so don’t become a microISV
casualty before you even get started.   [microISV]